The SaaS Paradox
By milan.thanawala on Feb 01, 2008
One of the interesting questions that was asked at an event recently was whether the slowdown in the US economy would have an impact slowdown SaaS' momentum. Its an interesting paradox whether something that reduces customer spending up front, may in fact be impacted by the reduced customer spending.
The arguments for a SaaS slowdown were cited as a general slowdown in tech spending, and a cut back in Marketing and other "non-essential" budgets that typically spend on SaaS applications.
The arguments against a SaaS slowdown were that SaaS apps are no longer "discretionary", they are mainstream apps that have a tangible ROI & benefit for the customer. If anything, customers demand a higher return on their tech investment in a slowdown, and with SaaS, one can see the benefits of technology investments much more clearly & quickly than in a traditional technology spend. The slowdown according to some, might actually make SaaS more mainstream as customers focus on their core businesses, reduce their capital spend, while keeping their operational expenses in check.
Whether SaaS will be impacted by a slowdown or not is something that time will tell, however ts clear that SaaS is here to stay, and is certainly not going away.